Neste Oil’s (OMX: NES1V) Q2 revenue increased to 3 647 million Euro. Second quarter comparable operating profit was 32 million. Net cash from operations was negative 126 million Euros. Second quarter EPS was 25 cents and EPS for the first half is now 71 cents. Neste Oil is down 10% close to 9 Euro per share.
The refining market weakened towards the end of Q2 due to concerns over global economic developments. Neste Oil thinks that it, as a ”complex refiner”, will outperform peers in an uncertain environment. Neste feels that part of that comes from diesel margins continuing to outperform other product margins.
Neste’s total refining margin was USD 8.99/bbl. Neste benefits when discount of Urals crude to Brent is large. The company foresees the difference to average USD 2.50-3.00 /bbl for the year. Neste’s Oil Products’ second-quarter comparable operating result was 60 million Euros.
Neste Oil’s renewable business is in ramp-up mode and will generate a loss for the year. The renewable diesel plant in Rotterdam has been completed. Neste was disappointed with renewable diesel sales for H1 but says the sales are set for a large increase in Q3. Then again in outlook the company says that despite higher sales, Renewable Fuels third-quarter result is expected to be weaker than in Q2 on high unit costs and start-up costs from Rotterdam plant. Second quarter operating loss was 55 million Euro for the business unit. Neste has introduced new renewable feedstocks such as soybean oil, camelina, and jatropha and has more ISCC-certified feedstock available.
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